Several startups and real estate owners are jumping into the apartment-sharing business, where they rent out individual rooms instead of entire apartments, The Wall Street Journal reports.
Read more: Will Renters Embrace the Adult Dorm Trend?
For example, Property Markets Group, through its PMGx division, started offering the "co-living" option in one of its Chicago buildings. The company plans to develop more buildings designed for co-living and expand the offerings to more than 7,000 beds in 3,500 apartments over the next few years.
The co-living units are often being marketed to millennials.
"Everyone is trying to wrap their arms around new living concepts for millennials," Ryan Shear, a principal with Property Markets Group, told The Wall Street Journal.
The one-room rentals can be cheaper for renters than renting the entire apartment. For example, PMGx tenants pay as low as $1,000 a month to rent a room than the entire apartment. Renting an apartment in Chicago, Miami, or other major cities often costs double that.
Developers say co-living apartments will cost more to build than other apartments, however. Each room will have a separate bathroom. Many of the units will also come partially furnished with built-out closets and TVs, The Wall Street Journal reports.
However, developers are attracted to the idea that they can charge more for a co-living unit, collecting rent from multiple tenants, than if they rented the space to just one tenant.